THE BLOG
06/13/2010 05:12 am ET Updated May 25, 2011

Psst ... It's a Moderate Bill

"Embarrassingly liberal," "shockingly liberal," and "too liberal for too long" are among the highlights of former Republican strategist Arthur Finkelstein's narrative on Democrats in the 1980s and 1990s. Born out of the bare-knuckle campaigns of Senators Alfonse D'Amato and Jesse Helms, Finkelstein did as much to ruin the word liberal as midnight basketball did.

Taking a page from the Finkelstein playbook, the entire Republican critique of the health care legislation -- the "government takeover," "massive spending," and "runaway costs" -- is meant to reinforce a decades-long stereotype of liberalism run amok. You can almost hear the line "it's liberal and it's wrong."

When Finkelstein leveled the liberal charge on Bill Clinton in 1996 it didn't work. "We are trying to make this race against a liberal and Bill Clinton won't play," said a Dole strategist at the time.

There is a lesson here for Democrats. As the fight over health care reform moves to its post-passage phase, supporters must win one key argument: the placement of this legislation on the ideological spectrum. If by November the bill is deemed as liberal, Democrats could be in deep trouble. If it's seen as moderate, it's a whole new ballgame.

For Democrats, the task is complicated because the legislation fulfills one of the most hallowed liberal dreams of the last 75 years: that of universal coverage. But the reality is that this liberal dream is fulfilled by ideologically moderate means. And even though these moderate means are sometimes distasteful to the liberal base, to win this key argument, the moderate foundations of this legislation must be highlighted.

For example, liberals hate vouchers. But the bill provides universal coverage through a conservative, free-market delivery system akin to a voucher program. Supporters like to call them subsidies and tax credits, but they are operationally indistinct from the housing and education vouchers championed by conservatives from Jack Kemp to Ronald Reagan to Newt Gingrich.

The final plan contains no government-run public plan and relies heavily on private insurance to expand coverage. Liberals love to hate the insurance industry. But the five largest publicly traded insurance companies have all reached, or approached, their 52-week share price high since the President signed the bill. This legislation is clearly good for the industry.

The liberal stereotype is of profligate spending. Yet, in contrast to the Bush era expansion of Medicare that added billions to the deficit, this legislation cuts government spending to pay for itself and more.

A conservative free market idea -- the exchange -- will allow insurance to be sold across state lines and generate greater competition among insurance companies to attract customers. The bill provides a series of Good Housekeeping Seal consumer protections that conservatives readily supported. It eliminates the maddening fine print that led to insurers dropping coverage of those with pre-existing conditions, those who had a serious illness, or those who lost coverage through the loss of a job or a spouse due to death or divorce.

Liberals aren't generally seen as defenders of business, but the bill will lower the cost that Americans and American businesses pay for health care by several hundred billion dollars. It does so by encouraging insurance companies, hospitals, and doctors to use the most modern management techniques to cut unnecessary administrative costs. It begins to replace the old fee-for-service payment system with a pro-market fee-for-outcome payment structure. It will allow businesses and individuals to spend those savings on things that promote economic growth -- like higher wages, research and development, and consumer purchases.

And insofar that the legislation addresses the delicate issue of abortion, it leans in an unmistakably pro-life direction. The Nelson compromise is a clear victory for pro-life advocates, and other measures of the bill will almost certainly reduce the prevalence of abortion through common ground, common sense measures that lessen unplanned pregnancies.

Whether it's Paul Krugman in The New York Times, Jonathan Chait, or Neera Tanden in The New Republic, the bill has been described (sometimes pejoratively) as moderate. Don't fight it; own it. The moderate label is a strength and comfort to many Americans. It also has the added benefit, to paraphrase Henry Kissinger, of being true.

Jim Kessler is Vice President for Policy and David Kendall is Senior Policy Advisor on Health and the Federal Budget for Third Way, a moderate think tank.

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